Tag Archives: Sturm

Following the October, 2015 mass shooting at Umpqua Community College in Oregon, MoveOn.organnounced a petition drive asking gun-owning members of the organization to ‘push for common-sense gun control measures;’ an activity which netted support from more than 32,000 gun-owning MoveOn members within one month. Practically speaking, the petition went nowhere, but at least it demonstrated that not every politically-minded gun guy supports the NRA.

And this is good news for the gun violence prevention (GVP) movement, because it runs counter to the usual assumption that the basic fault line dividing Gun-nut Nation from Gun-sense Nation is the ownership of guns. Not that 32,000 gun-owning MoveOn members compares to the alleged 4 million gun-toters who line up for NRA. But it’s enough of a base to convince other MoveOn members to get involved, which can’t but help grow the strength of the mainline gun-sense organizations like Shannon’s Moms, Everytown,Violence Policy Center, and the Brady Campaign.

I’m not optimistic about the chances of national gun regulations moving forward in the Age of Trump, but if The Donald gets on his high horse and starts ranting about the 2nd Amendment (a subject that has yielded a curious silence from the 26th Floor of since he ended his campaign,) there’s nothing that gets the opposition more worked up than being able to identify a threat from the other side. But if Gun-sense Nation wants to mobilize a wider swath of active supporters, particularly folks who largely sit on the sidelines today, they are going to have to come up with a message that reaches beyond simply reminding people about the number of people killed with guns.

And this is where the activities of public service organizations like MADD and the anti-smoking groups aren’t such a good fit. Because everyone drives a car and everyone knows someone else who smokes. But as an important article published today in The Trace points out, even in cities with high (and increasing) gun-violence rates, like Chicago, Milwaukee and St. Lou, there are many neighborhoods where gun violence remains at historically low levels, and it’s in these more affluent areas, both within the cities and the suburbs, where folks who need to be motivated about gun violence tend to live.

So coming up with a message to which people not directly affected by gun violence will understand is not such a simple or obvious thing. And if the GVP community thinks they can adopt or own a phrase that promotes ‘responsible’ gun ownership, the gun industry itself has been using that exact messaging for over thirty years, and I know they have no interest in sharing idea with the other side. Now I’m not talking about the NRA’s phony Eddie Eagle safety campaign whose effectiveness has never (read: never) been evaluated at all. I’m talking about the gun industry itself and the basic message that has been promoted by the world’s largest manufacturer of small arms – Sturm, Ruger & Co. – for the last thirty years.

Back in the 1980s, America’s most iconic gun designer, Bill Ruger, adopted the slogan ‘Gun Makers For Responsible Citizens’ to go with the unique heraldic eagle logo that had originally been designed by his partner, Alexander Sturm. Ruger considered himself a designer and manufacturer of sporting arms, his first hunting rifle to incorporate military-style engineering, the Mini-14, shipped from the factory with a 5-shot mag. In the run-up to the 1994 assault weapons ban, Ruger endorsed not a gun ban but a ban on hi-cap mags, a stance he then quietly abandoned when talk about a company boycott started to spread around.

In recent years, Sturm, Ruger has moved into promoting small, concealable hi-caliber pistols, a product shift which gives GVP an opportunity to push its own definition of responsible gun ownership focusing not on the behavior of gun owners but on the guns themselves. A 9mm pistol no bigger than a droid simply isn’t a sporting arm. And that’s what causes gun violence – it’s the gun, stupid, it’s the gun.

I love when The New York Times, the so-called newspaper of record, publishes an interview with a quick-buck artist who bought shares of Smith & Wesson after the massacre at Sandy Hook and tells us that “some” Wall Street investors see gun companies as a good buy. Meanwhile, if you bother to read Julie Creswell’s entire article, you quickly learn that the real Wall Street money – institutional funds – are staying as far away from gun investments as they can. And the reason for this is very simple, namely, that putting money into a publicly-owned gun company represents an investment in an enterprise whose value has little or nothing to do with the health and business prospects of the enterprise at all.

I recall that in September, 2012, there wasn’t a Republican who didn’t believe that all the polls showing Obama beating Romney had to be wrong. After all, how could a President get re-elected with an unemployment rate that was holding at 8%? It’s the economy, stupid. Remember that? Meanwhile when voters went to the polls in 1992, the unemployment rate was 7%, so no way Obama was going to go back to the White House again. And there wasn’t a retail dealer in the country, including myself, who could figure out what to do with all the inventory that was sitting on our shelves, because we knew that if Romney got elected, gun sales would collapse.

Well Romney didn’t get elected and several weeks later we had the awful shooting at Sandy Hook. And the result of that massacre was a spike in gun sales, and another spike when Obama started pushing a gun-control bill, and now another spike because Obama’s promoting his own gun-control initiatives regardless of whether Congress wants to go along or not. Even the NRA, which has been peddling a paranoid vision of Obama doing something drastic in his lame-duck term, admitted that the proposals were fairly mild and didn’t add up to all that much.

But let’s go back to the NYT article and focus on the data used by Julie Creswell to drive her argument home. The article contains a graphic showing how the stock prices of Smith & Wesson and Ruger have climbed over the last several years. Note that the S&W share price was around $16 in mid-2014 and then fell like a rock to under $10 at the beginning of 2015. During roughly the same period, Ruger stock dropped from $75 a share to $35. Both stocks began climbing again in the 2nd quarter of last year, but the price that is now attracting traders like Louis Navellier isn’t s reflection of the gun industry’s long-term health, it’s a classic bubble which, like all bubbles, will soon burst and the stock will die.

Why do I say that? Because the collapse of those stock prices back in 2014 was the result of the gun industry discovering that even after Sandy Hook and Aurora, the ability of the gun market to absorb new inventory could only go so far. It took gun makers a year to ramp up production once it began to look like a gun-control effort would succeed, but by the time all that additional product got through wholesale distribution and onto retail shelves, the mad rush into gun shops had slowed down.

The gun industry can talk all it wants about how fears of terrorist and/or criminal violence are creating a new customer base. They can have Colion Noir pitching to the inner-city market and Dana Loesch speaking on behalf of ‘America’s Moms,’ but it just doesn’t work. The only folks who remain convinced that you can protect yourself from gun violence by responding with gun violence are the folks who keep buying guns whenever they believe they won’t be able to buy guns. The truth is that investors who put their money into gun companies aren’t really investing in the gun industry, they’re investing in fears that the industry won’t survive another Sandy Hook. Maybe it won’t.

When I was a kid growing up in the 1950s, there was very little talk about guns that didn’t in some form or another relate to Cowboys, Indians and the Old West. Actually, the Old West wasn’t really that old, because it was only in 1890 that the Census Department stated that the frontier was now ‘closed.’ But the West was old enough to be featured in Shane, the very first movie I went to see, I never missed an episode of weekly television shows like Gunsmoke starring James Arness, and I chased plenty of make-believe Indians with the Colt Single Action Army plastic revolver strapped around my waist.

The kids growing up today continue to see lots of guns on video and tv, but the context has changed from Westerns to soldiers, with the guns now symbolizing our overseas military adventures in places like Afghanistan and Iraq. And there doesn’t seem to be a single gun maker who doesn’t try in some way to tie his products to the military, and I’m not just talking about the obvious connections between Bushmaster or Colt black guns and the battlefield; take a look at how Glock is pushing its military product line or the soldier-like images behind Smith & Wesson’s online rebate form.

If you really want to see a consumer-products company that’s gone whole hog for the military look, take a gander at the new tactical online store of the NRA. Wait a minute. I thought the NRA was a gun-advocacy organization that promoted gun safety, sport shooting and, most of all, the protection of our civil rights (a.k.a the 2nd Amendment which the NRA claims to be the most important civil right of all.) Since when did they become involved in promoting, never mind selling tactical gear to guys and gals?

Actually, from as long as I can remember, the NRA always sold products that promoted its own brand, like books on shooting and training, decals for the back of the truck or the side window of the car, and caps, shirts and other garments that proclaimed one’s support of gun rights, freedom and the American way. There’s nothing wrong with any organization securing its financial base by selling items that both increases the bottom line as well as getting the logo and the message out in front of the public eye. But what I find interesting about the new tactical product line is that for the first time, as far as I can remember, the organization is selling products that are actual accessories for guns. It’s one thing for an organization to sell a shirt embossed with a logo which can be worn at a shooting range but can also be worn anywhere else. It’s another thing to sell hi-cap magazines for AR-15s, or universal gun magazine reloaders, or instant concealment kits which can, according to the advertising, convert “ordinary” packs and bags into “extraordinary” gun concealment systems.

The NRA isn’t selling these products because they are trying to start a new trend. The fact is that promoting guns and gun gear has become part-and-parcel of the general militarization of our culture since the horrific events of September 11, 2001. After all, if we are going to let the local cops ride around in armored personnel carriers and carry bayonets on their AR-15s, why should we be shocked when the NRA sells tactical-style boots for only $129.95?

The great irony in the NRA’s attempt to make common cause with the military is the whole point of the 2nd Amendment was to give citizens the right to defend themselves with guns because liberties might be threatened by a central government that had a monopoly on armed force. Of course the Framers couldn’t imagine a central government run by a liberal who also happens to be Black. For that matter, I can’t imagine that any of the stalwart defenders of our civil rights who happen to be selling goods in the NRA tactical store know or even care what the 2nd Amendment really means.

Has anyone noticed what’s been happening to the gun business lately? Smith & Wesson stock has collapsed, it’s trading for about half of the price of just five months’ ago; third-quarter net sales at Ruger dropped from $170 million to $98 million from the same quarter a year ago; and the industry’s most venerable gun maker – Colt – might have closed its doors altogether had it not been saved by a last-minute loan.

Gun sales started to slow down during the summer, which is normally when everyone in the gun industry takes a deep breath and begins planning for the fall and winter months when most of the industry’s sales take place. But not only didn’t the usual rebound occur after Labor Day, they stayed flat in September and then really began to go South. If you had purchased 10,000 shares of S&W on June 19, your investment today would be worth less than six thousand bucks. Meanwhile, the Dow during that same five-month period has surged upward by more than six percent.

The gun industry usually uses the monthly NICS background check number to chart sales trends, but lately those numbers simply don’t square with the market conditions that have affected the balance sheets ot companies like Ruger, Colt and Smith. While NICS checks have certainly dropped from the more than 2 million monthly numbers that were recorded at the end of 2012 and the beginning of 2013, the numbers just published for October showed a slight increase over the previous month and the September number was the second-highest September ever recorded by NICS since the system became fully operational in 1999.

I’m going to tell you a dirty little secret about those NICS numbers. What they really show is that more gun owners are registering gun transactions with NICS whether they need to or not. In some states, like Connecticut, NICS calls are much higher because the new law requires that all gun transfers between individuals, not just between dealers and purchasers, go through NICS. New York State, where Andy pushed through a universal background check law right after Sandy Hook, is now running 30,000 checks a month when the state averaged less than 20,000 monthly before Sandy Hook. Right after Connecticut mandated universal background checks there was stupid talk by Glenn Beck and other NRA apologists about how Connecticut gun owners were going to stage massive disobedience against the registration requirements of the new law. These are the same [expletive-deleted] loudmouths who never miss the opportunity to remind the rest of us how ‘law abiding’ gun owners tend to be. Now these law-abiding patriots are going to start lining up to break the law? Give me a friggin’ break.

Gun sales have always been a function of one thing and one thing only, namely, a fear among gun owners that the guns are going to be taken away. Right after the World Trade Center attack there was a brief spike in sales, but by the time it was noticed, it had already disappeared. Even before Obama started talking about a gun bill after Newtown, Dianne Feinstein rolled out her assault rifle ban, and within two weeks you couldn’t find a black gun on any dealer’s shelves. I was selling the Stag AR-15 Model 3 in my shop when I could get them, for a thousand bucks a pop and other dealers were marking them up even more. Today I can go online and buy one for $736.89.

I don’t think the drop-off in gun sales will end anytime soon, particularly now that both legislative chambers in Washington are painted red. But I also don’t think that the vulnerability of the gun industry will make its leadership more amenable to discussing effective strategies to curb the misuse of guns. Because the one thing they know above all is that the anticipation of new gun controls will spur sales, but after the law is passed, gun ownership always declines. If it goes much lower, the gun business will be in for a very rough time.

Guess what? The great surge in gun sales that started after Obama was re-elected and then spiked when a national gun bill was pushed (but defeated) after Sandy Hook has come to a jarring end. Smith & Wesson just announced its results for the quarter ending July 31 and earnings dropped 45% with sales revenues off by more than 20%. The biggest revenue tumble occurred in “black” guns, aka modern sporting rifles, aka Ar-15s, aka assault rifles which, according to company documents, accounted for 87% of the total sales decline. But even more interesting was the fact that product inventory increased by more than 20% from the end of the previous quarter, which means that more and more guns are simply sitting unsold on factory shelves.

Smith & Wesson’s stock price shot up from $2.50 in September, 2011 to $16.68 in June of this year, an increase which reflected the surge in gun demand before and particularly after the massacre at Sandy Hook. During roughly the same period, the value of Sturm, Ruger stock also increased more than four times. These were heady days in the gun business, with a demand outrunning supply for every type of gun.

But that was then and this is now. While the gun industry tried to explain this surge as due primarily to new customers (women, millennials, urbanites) coming into the shooting marketplace, the hard, cold facts are that most of the recent sales of guns ended up in the hands of people who already owned guns and were therefore more sensitive to the possibility that gun legislation might take their precious toys away. The NSSF recently published the results of a membership survey which claims that target shooters are increasingly younger, female and urban-based. But the report conspicuously avoids any discussion about whether the number of people participating in target shooting is going up or down. Here’s a hint: Smith & Wesson’s quarterly report noted that the only type of guns for which sales increased in the last quarter were small, concealable polymer pistols. You might want to take your new pocket pistol to the range once to make sure it works, but if the NSSF considers such people to be getting into “target shooting,” then I can say that I’m following my diet between meals.

The gun industry began pretending that assault-style rifles were “modern sporting rifles” because they were encountering resistance from family-oriented chains like Cabela’s and Dick’s Sporting Goods who felt that black guns didn‘t have the wholesome image that stores which considered themselves to be family shopping destinations wanted to project. I happen to be the person who, in 2009, donated the URL www.modernsportingrifle.com, which I owned, to the NSSF. I gave them the rights to use the URL at the 2009 Shot Show and in our discussions that preceded the transfer their counsel made it clear that this was part of a marketing plan to align black guns with mainstream consumer tastes. Given what has happened to sales of assault rifles in the last several months, it looks like the mainstream and the black gun stream have parted ways.

I’m not surprised at this recent turn of events as regards the sale of guns. You can justify gun ownership as important for self-defense, as representing liberty and justice for all, as protecting hearth and home, but a majority of Americans don’t own guns, and the industry hasn’t been able to figure out a marketing message that explains to non-gun owners why they should change their views. The real trick, however, is to get all the non-gun owners to be as committed about regulating guns as the gun owners are committed to making sure that more gun regulation doesn’t take place. Because there’s always the possibility that sooner or later there’s going to be another high-profile shooting and Smith & Wesson’s stock price will take off again.